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How public database could affect contractors

Jim Williams, former Commissioner, Federal Acquisition Service, GSA

We've been telling you about a new law that requires the public disclosure of contractor integrity details, like criminal activities, canceled contracts and defaults.

The changes are part of a defense spending bill the president has signed. And the information will be posted online, from a GSA database that was once open only to the government.

The goal is more transparency and accountability for contractors. But what if the information is wrong? How do you do the right thing, if you're one of the people making contracting decisions for your agency?

Jim Williams is former federal acquisition service commissioner and says, as the new database becomes public it will put a higher standard on those responsible for reporting, and that's where problems can occur.

"Frankly, great damage can be done if information is put in that is simply wrong, or has been deliberately put in there to hurt somebody. I think there has to be greater scrutiny before something goes in there, just because of the greater visibility that comes about through making this public."

Williams say the site will be set up like eBay in that contractors will be able to comment on what's reported, but that takes more time and can lead to "he said, she said"-type fights.

"It also causes problems [if] you have somebody who might have settled something, [and] maybe they settled for a good reason, as people often do, to avoid protracted litigation. Now, if you settle and, as part of that settlement, admit some fault, all of a sudden that can become a giant negative. I think that may lead to people not doing the right thing in terms of their business -- not making a reasonable settlement when they should."

Williams doesn't think making the database public is all bad, however. He acknowledges that the concept is a good idea, but worries that, as the process stands right now, different folks could be unnecessarily penalized.

"I have seen people in government do things . . . not well. In the case of one agency who decided to suspend a large company, and they didn't suspend part of it, they suspended all of it because they said they couldn't figure out the organizational structure of the company. That was wrong. I've also seen people who almost seem to enjoy the fact that they have this power to say, 'Well, I got this person removed from a contract'. If you're just abusing that power, that can be hurtful."

The other problem stems from the fact that the government often holds some responsibility if something goes wrong, as well. Williams says the public reporting does put a lot more onus on the contractors, but they don't always have complete control of the situation.

"The government could say, 'Well, the contractor messed up. It couldn't be us. Let's send them a cure letter,' and . . . that's a high standard, too. In fact, I had to tell somebody -- when I was director of procurement -- when they wanted to send somebody a cure letter, I said, 'No, you have no basis for doing this,' and it was a time when the government was not getting their requirements down. On the other hand, I think the government needs these tools in the toolbox to deal with contractors who are at fault, but, again, it just takes better judgement and it also may take better scrutiny of those judgements to make sure we don't harm anyone."

The problem, too, is that some of the rules for the database are vague, in Williams' opinion.

"One of the provisions, I think, says that a contracting officer, when they look at this information, should decide whether to refer that information to a suspension/debarment official. So they're looking at information that's in a database that everybody else is looking at, and one contracting officer says, 'Well, i think that looks serious. Let's refer it for suspension,' and another contracting officer says, 'Well, that looks bad, but not so bad'. . . . That costs time and money, every time somebody refers something. I think there's a lot of potential pitfalls here."

Williams says he thinks a lot of training in order to make sure this information is not only transparent, but accurate.

"Having that kind of information where contracting officers can look at -- is this a good company -- is a good thing."